Unlike many of my small yet faithful readership, I have been absent for several weeks from these pages. My thanks go out to those persistent readers who flatter me greatly by their repeated visits to my site in spite of my recent silence. I just hope that you will all forgive my lapse and continue your visits.

Perhaps some had thought that I had been the target of crime, with a dash of xenophobia thrown in for good measure. No, nothing quite so dramatic, thankfully.

I have been absent for rather more prosaic – and, it must be said, selfish – reasons.

Firstly, I have to confess that I find writing to be extremely hard work – and which is probably self-evident from the quality of what I have produced thus far. I have always been mildly word- and number-blind at the best of times and this can be disadvantageous when one’s brain races faster than the ability to write or type out thoughts into an acceptable format. It can take me several days to produce one of my little contributions.

And despite sharing the fault of many writers – namely, that of having the arrogance in assuming that what one wishes to express is worthy of the time and attention of one’s hoped-for readers - I tend to avoid until the last possible minute actually creating the masterful missive, waiting until the urge to present my particular and peculiar ideas can be restrained no longer.

A driven firebrand clearly I am not…

Secondly, my office is fiery hot in summer and numbingly cold during winter. Owing to the fact that our beloved telecommunications monopoly, Telkom, no longer wishes to provide fixed-line telephone/fax/Internet services to my suburb (just 40 km from the centre of Johannesburg), I have had to resort to the incredibly more expensive and temperamental wireless services offered by a local cell phone network – whose signals are unavailable within the body of my house. Consequently, I have had to move my office into a partially completed and totally uninsulated outbuilding some distance from the house where, on good days, I can receive a signal just barely adequate to conduct my modest business and creative activities.

Today, with an outside temperature of around 19 degree Celsius and 8 degrees Celsius inside my spacious storeroom/barn, it is not too bad. Yet my fingers are still stiff with cold, my feet no longer part of my body and my arms and torso almost immobile because of the layers of clothing encasing my shivering frame.

Thirdly, since my last post last month I had the chance to earn a couple of bucks, so had to take a few days chasing some consultancy work – regular full-time and permanent work is hard to come by for a white man in his fifties in South Africa these days. As mentioned in a previous post, I like to eat on occasion.

Fourthly, I have been severely distracted by some immediate family concerns.

The first of these has been the impending permanent departure from South Africa of my daughter and her little family. At last, she has had enough of the crime, the corruption, the utter indifference to levels of professional service delivery and the inability for a person of her considerable energies and skills to progress in life merely because of her European ancestry.

This truly is a tragedy for South Africa. Even allowing for the fact that she is my daughter and my resultant natural bias, I have come across few people who have demonstrated anything like the grit, doggedness and sheer natural ability of this young woman. Having divorced her pathetic and selfish excuse of a husband (and whom I shall be making a point of seeking out one of these fine days), penniless and with a small daughter of her own in tow, she has exhibited a strength of character that saw her not only raise her child into someone I am proud of but also drove her to carve out a life and career to the maximum possible under the circumstances of present-day South Africa.

Her new life will be no easier to begin with. She will, however, be allowed to take her career to whatever level she desires; the only obstacles she will face in her new home will be those imposed by her ambitions and her talents.

I shall greatly miss her and my first granddaughter.

The second family concern that has been occupying my attention in recent weeks relates to my second granddaughter.

Born three months premature last month, this little pink angel has been fighting for her life since being so rudely thrust out into the world. Fractionally larger than my outstretched hand when I first saw her the day after her delivery, she has repeatedly faced the spectre of death – including surgery on a heart little larger than my thumbnail (and, in the process, reducing the surgeon and his team to tears as they worked their incredible skills on that tiny body).

Expecting, at any moment, to hear the worst, this little girl has fought back time and time again. We all thought that the end had come early this week when, hours after the heart surgery, she crashed catastrophically. One of the nursing staff, bless her, even hung around in the waiting room for several hours that same night - after the end of her twelve-hour shift - just to be there.

After counseling my son and his wife, the decision was reached by the doctors to take the baby off the ventilator. The family gathered to say their farewells to her and to await the arrival of the doctor who would be switching the machines off.

The machines are still running. Incredibly, joyously, just one hour before the due time, my little granddaughter, whom I had angrily accepted that I would never know, rallied and, for the time being at least, re-stormed the ramparts of life yet again.

Even those most cynical of creatures, the doctors and nurses, described the recovery as ‘miraculous’.

Who knows what the next hours, days, weeks and months will bring. Perhaps all of the terrors and fears of the last few weeks will be for naught. I feel most, of course, for my son and daughter-in-law. My desperate hopefulness can be as nothing compared to theirs. The little that my wife and self have been able to do has been confined largely to babysitting our three-year old grandson and trying to distract him away from his bewilderment and anxiety at all the upset within his family at present.

To those who gave thought and prayer to the newest member of our family in her predicament I offer my thanks – even though I have never met or known most of you. To the doctors and nurses at the Medi-Clinic where this little drama is being played out, I offer my thanks for your skill and concern.

To my new granddaughter – be with God and give it all you have.

Spearpoint.

12th June 2008

Today the media are full of the barbaric xenophobic attacks that have been taking place in and around Johannesburg over the past week or so.

Quite right, too.

It’s interesting, however, that the xenophobic murders of hundreds of Somali refugees in the Cape Town area some months ago never prompted the same aghast response of shock and horror from the media.

What a shame that the xenophobia which is so characteristic of Africa in general and South Africa in particular is being portrayed as a recent phenomenon. Very little recognition has been given to the fact that xenophobia has always been an intrinsic part of African life throughout the continent and I doubt that much will change in that regard.

The Xhosa hate the Zulu. The Hutu hate the Tutsi. The Shona sneer at the Matebele. The Bushman and San are reviled by everyone. The list is as long as the number of tribes on the continent. And it is not new; many of the efforts of the past colonial powers went towards quelling and controlling the culturally traditional internecine strife between the peoples under their yoke and trying to instill a wider sense of purpose – to no avail, it would appear.

Whatever the reasons for intra-African xenophobia, it is a fact that it exists and is so deep-seated as to be all but ineradicable in the foreseeable future – notwithstanding the best efforts of sociologists, anthropologists, psychologists and panels of so-called experts called upon to explain and remedy the periodic flare-ups that occur in a general climate of simmering distrust and demonising mythologisation.

Under such circumstances it doesn’t take much to throw the spark leading to conflagration.

South Africa is a good case in point.

• The thrusting together of large numbers of people from diverse and historically antagonistic groups in the overcrowded ghetto-like environments of townships and squatter camps.
• Large-scale and uncontrolled illegal immigration from poorer neighbouring countries.
• Insufficient, inefficient and corrupt delivery of the most basic of human needs to those who have been deprived for so long.
• Poor education facilities and expertise from kindergarten on upwards.
• Insufficient work leading to an excess of available time to drink and seethe on the perceived causes of various misfortunes.
• Failure by government and its organs to devise and enforce policies and practices to, firstly, control and then eradicate crime and its consequences.
• Failure by community, municipal, provincial and national leaders to elevate themselves as role models away from the basest elements of human behaviour.
• Failure by the above leaders to acknowledge and actively address numerous problems, ranging from crime, policing, corruption, HIV/AIDS, service delivery and so on through to public office probity.

These are just some of the factors which make it too easy to find scapegoats when life gets a bit tougher than usual. And the scapegoats are, all too often, those who, for some reason or another, don’t fit into the usual patterns of local life; those from outside the country, outside the district, outside the neighbourhood – the most vulnerable because they are isolated and, therefore, easy targets. The savagery of the attacks is peculiarly African – witness the days of the Congolese uprisings, the ‘necklacings’ of South Africa and the genocide of Rwanda and Burundi.

Such targeting, of course, is the course of the ignorant and the cowardly – those too lazy to make the effort to properly evaluate the causes of their present predicament and too craven to challenge those events or people truly responsible for their plight (including, I might add, themselves).

The response of our government has been to convene a panel to investigate the causes and results of the violence in the townships.

Whoops! Wrong thing to do – at least, in the short-term. Fine for the longer view and for the formulation of later policy.

Short-term – get the situation immediately under control. If the police can’t handle it (and they seem, as ever, to be struggling) then get troops in. Separate the rival groups. Patrol the streets. Shoot dead (remember the words of the Deputy Minister of Safety and Security?) the attackers and opportunistic looters.

This is a time for resolute and firm action to quell the trouble before it becomes even more widespread and indiscriminate. This is not the time for anguished hand-wringing or high-minded political and social theorising. Fix the problem now and worry about fixing the blame later, when time permits.

Already I can hear the gasps of disbelief from the rest of the world – and the increasingly overt sniggers over our inability to face up to the daily realities of running a Third World country.

Worse still, I can hear the cries of despair from our own people as they witness yet another step into chaos and depravity.

Spearpoint.

19^th May 2008

So here we have it, at last. It has been a while coming, but come it has.

Not that it has been unexpected. It was bound to happen eventually, in one way or another.

Many very astute and able writers have been trying - for some considerable time - to show how South Africa has been slowly descending into the abyss. More recently Spearpoint has (with far less ability and effectiveness) added his own voice to the warnings that have been increasingly thronging the various media available to us in this country.

I fear that it will all be to no avail.

The pessimism, even despair, which has silently pervaded South African society over the last decade or so, is now gaining increasing momentum even amongst those who celebrated the most after the release of Nelson Mandela.

Now we begin to see the true colours of our Rainbow Nation; colours that were once purposefully and skillfully hidden behind shimmering nebulae of rhetoric and political razzle-dazzle are now being glimpsed more often as the perceived need for global political respectability is, more and more, discarded as the ANC and its puppet masters gain in confidence and arrogance.

Today, the legislation to disband the elite crime-fighting unit known as the Scorpions has been tabled in Parliament.

Modeled broadly on the FBI, the Scorpions have proven to be a formidable and largely untouchable crime-fighting force that has shown little or no favour and has appeared to be indefatigable in the pursuit of those who would place themselves above the law. They have been a very necessary foil to the poorly performing South African Police Service.

Why the ANC has bothered to involve Parliament escapes me. South Africa is a dictatorship of the elected majority party (the ANC), with absolutely no prospect of any realistic challenge to the current status quo being mounted through the ballot box anytime in the next couple of generations.

The ANC might as well come clean and rule by decree. It would save them and the rest of the world time, effort and embarrassment over the increasingly amateurish attempts to legitimise their fumbling realisations of their ambitions.

The signs have around for a long time.

• The selection of a party leader – soon to be the country’s President - who is awaiting trial on corruption and related charges investigated and brought by the Scorpions.
• The blatant and public protection by the current President of the country – with the tacit approval of the ANC - of the national Police Commissioner who faces serious charges investigated and brought by the Scorpions.
• The blatant and unashamed protection of numerous public officials and office holders who have either admitted or have been convicted of innumerable offences ranging from drunk driving through fraud, embezzlement and worse.
• The blasé and indifferent approach to, and acceptance of, crime levels unparalleled outside of war zones such as Iraq. (An example – it is generally accepted that a rape occurs in South Africa every 23 seconds. Do the math – 1.4 million rapes per annum in a population estimated at around 45-50 million people).
• The awesome drift from reality embodied in the continuing and, until very recently, unquestioning support of rogue and repressive states such as Zimbabwe and Burma – behaviour which has led to the ridicule and scorn of the rest of the world, to say nothing of the loss of life and liberty of those poor unfortunates living in those countries.

And these are but a very few of the straws that have been blowing in the wind in recent years.

The Scorpions are but a single example of the lengths to which the ANC, COSATU and the South African Communist Party (all members of the tri-partite alliance which rules South Africa but of which only the ANC presents itself for election before the people of the country) are prepared to go in order to exclude themselves from scrutiny by both the courts and the electorate.

When will the people of South Africa – as well as the rest of the world – awaken to the fact of the immense confidence trick being played upon them at their expense?

Do we have to wait for the raids on the newspapers and televisions stations to become more frequent? (It has already happened). Will we only realise our plight when the Internet and blogs are monitored, controlled and restricted? Will we have to wait for the situation in Zimbabwe to become a reality for South Africa (and so memorably and eloquently expressed by the unknown Zimbabwean who voiced it by saying “We have freedom of expression; we just don’t have freedom after expression”)? Will we wait until the cadres of the ANC and SACP are joined on their nightly dissent-suppression street patrols by armed MK war veterans? Will we wait for the type of bloodbath that surely lurks, Kenya-like, in Zimbabwe’s near future?

The writing is on the wall. We ignore it at our peril. We run the risk of a bovine-like acceptance of the denial and corruption of the hopes and aspirations of an entire country already brutalised in the not-too-distant past. Or, simultaneously, we run the risk of opening the door to hotheads and armed reactionaries eager to turn back the clock.

And as much as Spearpoint harbours hopes for this country and its people, it is very much my profound fear that already it is too late and that the time is nigh for the call to go out, “Would the last democrat leaving South Africa please turn out the lights”.

Spearpoint

13^th May 2008

A thought occurs…

Eskom, as we are all probably aware by now, seems to be hell-bent on hiking their tariffs to the ordinary South African electricity consumer by 53% this year and by a similar amount next year.

I now wonder if, just maybe, we poor and long-suffering victims of the South African corporate and political robber barons might reasonably expect a small glimmer of light at the end of this seemingly endless tunnel of despair in which we find ourselves.

In the vein of any good communist or socialist government, it was recently announced by our inefficacious Minister of Health that certain (unspecified) interventionist steps were being considered on the present crisis over rocketing food prices.

Just to digress for a moment – why such an announcement should be made by the Minister of Health rather than the Minister for Trade and Industry or the Minister of Finance I find to be confusing. Whilst I am sure that there are public health concerns to be considered if the very poor cannot afford to buy their staple foods, I do feel that any interventions – even in the form of food stamps – would be better managed as part of an overall economic and financial strategy led by the Department of Finance and whose Minister has shown some reasonable degree of competence over the past few years.

Anyway, to get back to the point I wish to make…

Now, if the South African government is demonstrating a willingness to change its stance and to interfere with normal market forces on food prices then surely, in order to be consistent, it should also consider a similar intervention on fuel and electricity prices.

There are several ways in which considerable assistance could be offered to the consumer without necessarily distorting the market and its operations.

For example:

1.       VAT could be reduced or removed for all foods, fuels and power supplies;

2.       Eskom could be required to either cease the supply of one third of our total production of electricity for export at the ridiculous price of eleven cents per kilowatt or to export it at prices which would give a far better return, thereby obviating the need to impose punitive tariff hikes on South African domestic consumers;

3.       The fuel industry could be de-regulated so that competition could be allowed on the forecourt and so that supplies of oil could be sourced in a manner that would free South Africans from the artificial and arbitrary pegging of spot prices to the Singapore market;

4.       Introduce new trading rules to control and penalize the exorbitant profiteering in the various commodity (particularly foodstuffs and fuel) markets that results from the unfettered and unnecessary trading, re-trading and re-re-trading of essential goods and commodities.

5.       As previously advocated by Spearpoint, the government could also abolish all direct and indirect taxes (e.g. income, provisional, dividend, corporate, payroll, VAT, fuel levies, compensation, UIF, provincial, municipal, etc. etc. etc. etc….) and replace them with a single, simple “consumer” tax on all goods and services (excepting food, fuel and electricity) in various bands. Thus, incomes would be maximized and protected and the tax burden for individuals and companies would be defined by how much they spent within all sectors of the economy. The tax could be designed and collected on much the same basis as VAT, thereby saving vast amounts in collection costs and public service staffing costs.

I am sure that there are other ways in which commerce could be stimulated whilst making the sharing of the tax onus across the entire population far fairer than it is at present. It just requires a little imagination on the part of the government.

Most importantly, however, the government, through its own initiative on food prices, has now opened the door to the possibility of constructive intervention in other, critical, sectors of the market economy.

Now they must get on with it…

Spearpoint.

13 May 2008

Why am I not too terribly surprised that the mismanagers of our electricity utility, Eskom, have done it again?

It’s a wonder that these guardians of our national electrical infrastructure don’t have tails wagging from their foreheads and noses on their behinds. Yet again yesterday they demonstrated, to mix the metaphor slightly, that they can’t tell their elbows from their fundaments.

After the unprecedented introduction of unnecessary, random and widespread power cuts (‘load shedding’) throughout South Africa late last year, these mismanagers then proceeded inexplicably to relax those early this year – quickly followed by a programme of what they variously called ‘pre-emptive’ or ‘predictive’ scheduled periods of blackouts based on a two-week cycle.

So we all begin to think to ourselves “Great! At long last these guys have finally begun to show a little competence and professionalism by getting their act together and allowing us all to be able to plan our lives around a fixed timetable of power cuts”. Still a bad situation, but one now that appeared to be showing signs of being managed.

Then, last week Eskom announced that, owing to the fact that South Africa was to chaotically cram three public holidays into a single week (between 28^th April and 2^nd May), load shedding was to be suspended for that week because the bulk of energy-hungry industry would be closed and its personnel enjoying itself either on the coast, in the bush somewhere or cowering at home trying desperately not to spend the money they will be needing in the near future to meet the increasing costs of food, petrol and their mortgages.

This time we all think “Great! A bit of relief from having to juggle our lives to Eskom’s tune”.

Now, to cap it all, yesterday Eskom announced that, with effect from 4^th May (next Monday) they would suspend all future scheduled load shedding because they were confident that the bulk of what they claimed to be necessary in terms of saving electricity could now be achieved without imposing blackouts on the country.

Now I’m not one (normally) to look a gift horse in the mouth – even an equine of such doubtful pedigree and value as this. But the constant about-facing of Eskom over the past few months really takes the biscuit and reinforces my personal belief and assertion that every one of the board and senior managers of Eskom should be removed from their posts and put in a place of safety – ours, not theirs.

(Those of you wishing to have a look at my previous posts on this particular matter of the spleen can find them by back-tracking on this site. I’m sorry, but I haven’t yet figured out how to insert those sexy little links into my posts. Maybe I won’t anyway – I want to encourage as many people as possible to actually read the other posts on other subjects that I have, so far, managed to wrench from my keyboard. See – an ulterior motive for ignorance and indolence.)

So…what began as a crisis, with recriminations and screams of outrage flying in every direction, then eased, then escalated into punitive scheduled blackouts and now appears to have relaxed so much that one is tempted to assert that there never was a crisis in the first place.

Shortly after the ‘crisis’ began it became known that Eskom was exporting one full third of its total production to neighbouring countries. It has now been stated that those exports were sold at prices significantly below the cost of production.

In other words, the South African consumer of electricity was subsidising – to a considerable degree – the governments importing South African electricity. (I can’t believe for one moment that the end users in those countries benefited from that subsidisation).

Excellent economics, Eskom. What’s the betting you got some nice fat bonuses for that little sleight of hand? And, no doubt, some kudos (or, perhaps, something rather more substantial) for the ANC politicians from their buddies around the continent…

Oh, and by the way, we South Africans contributed directly to the repression of the population of Zimbabwe by Robert Mugabe and his henchmen.

Gee, thanks. That’s really going to help me get to sleep at night.

On top of all that, we now learn that the serious consumers of electricity in South Africa – the mines, heavy industry and business in general – have been paying tariffs some 275% lower than the domestic consumer.

Bulk discounts (not normally a feature of the South African business mentality) I can understand. But 275% less is not a discount – it’s an outright gift. Subsidised by the domestic consumer – again.

There is no way that the vast majority of the electricity produced in this country (and consumed by industry) is sold at a loss. The stated profits of Eskom cannot possibly come solely from the domestic consumer.

So the domestic tariff, less 275%, as charged to industry, is hugely profitable to Eskom.

But sauce for the goose should also be sauce for the gander. Why is the domestic consumer not charged tariffs which are very much closer to the industrial rates (or vice versa, if the lies of Eskom were to be made more consistent)?

Why is Eskom fighting tooth and nail for a 100% increase in tariffs over the next twelve months? For the domestic user of electricity that is a killer of a hike in rates, but for industry it will be verging on the insignificant.

If Eskom needs funds to expand its generating and transmission capabilities (now doubtful, given the revelations about how much electricity is exported across our borders at charity prices), then why do the mismanagers of Eskom seek to extract the cost of their own screw-ups from their captive South African domestic consumers?

What is wrong with requiring higher charges for both the foreign customers and local industry? Why, in the name of all that is accepted as good practice in economics and business protocol in general, should we in South Africa subsidise the inefficiencies and malpractices elsewhere on our continent? Why should South Africa beggar itself for the rest of Africa?

And why does Eskom have only a one-dimensional approach to the problem – namely raising capital through tariffs?

There are other ways, such as, for example, raising a bond issue or creating and selling additional shares in its business. At least then those who can afford to subscribe to the capital expansion of Eskom could do so and those who can ill-afford mercilessly higher tariffs could continue to use electricity without having to sell their mothers-in-law and children into slavery.

It is clear that neither Eskom management nor the ANC government has the skill or the imagination to run and operate our precious electrical generation and transmission utility.

And because Eskom is a strategic national asset it should not be privatised, either. We neither want nor need the dubious benefits of parity pricing and gross profiteering that would, inevitably, result from such a move. Witness other countries around the world which have trodden that particular route. Power and water are public service utilities designed for public benefit and have no role within the commercial sector; they are too fundamental to the well-being of our nation and its people to be exposed to the rapine of the highest bidding speculator.

Rather operate the public utilities much as the State Electricity Commission was run in Victoria, Australia back in the 1960’s and 1970’s. A public utility, set up as a government commission charged with operating as a business - but without profit being the underlying raison d’etre.

We are being served by maleficent incompetents who have lied to us, failed in their due diligence and are, generally speaking, a pathetically sorry bunch of unimaginative time servers anxious more for their own benefices that those they are charged to protect and enable.

Please go away – all of you. Find something else – preferably in another place - that you can pervert and destroy.

Allow us to find those who are operationally able to run Eskom without destroying it, under the guidance of commercially competent managers who can foresee and prevent losses within a non-profit organisation.

Spearpoint.

1^st May 2008

The hiatus in this blog of the last couple of weeks resulted from me traveling a bit through southern Africa on business.

You should understand that, being a white South African male over the age of fifty, affirmative action and all the “-isms” of age, gender and race render me all but unemployable in this Rainbow Nation of critical skills shortages – notwithstanding my degrees and international experience in my field. So when work does periodically present itself I am compelled to grab it and to fiercely focus on the tasks that promise, for the time being, to maintain the temporal connection of body and soul. When money beckons I must then temporarily forego some of my other - more pleasurable and satisfying – pursuits such as blogging. And, much as I enjoy writing, it pays no bills and I have this expensive addiction to breathing which must be periodically slaked with cash – preferably lots of it – whenever possible. Hence my recent absence.

I am not so enamoured of driving as once used to be the case; my politically-incorrect car is an ageing brute that punishes its driver for forcing a few thousand extra kilometres out of its creaking carcass. But, in addition to providing a solid upper-body workout, such driving allows time to reflect on Life, the Universe and Everything and thereby provides some of the material which old Spearpoint then tries to convert into the approximations of pearls of wisdom that he seeks to muster in these posts.

During this journey I found myself mostly pondering on all the recent shocks of the astronomical price increases in food, fuel and other commodities around the world.

We’re all familiar with the price increases. Petrol and diesel prices threatening to push us back to the horse-and-buggy age; staple food escalations promising the prospect of global population decimation; real estate prices destined to shunt us all back into grass huts in a feudal economy; other commodities increasing to the point where the little baubles and the technologies which brighten up and buttress our otherwise drab lives are beyond reach; the threat of drastically higher electricity charges which promise a return not to the age of hurricane lanterns and candles – we won’t be able to afford to buy the oil – but to the age of rush lights and goose grease; the list goes on.

Trying to figure out why all of these events have come about in such an apparently short space of time has been an interesting exercise and has led me to some conclusions that are distinctly challenging.

We might as well face it: for a considerable period we have had it relatively easy. Ignoring, (for the sake of the point being made), the half or more of the world’s population that has always been too poor to afford to worry about the fibre in its diet (instead being more troubled with the grit, stones, twigs and other detritus in such food as may be available), the world has enjoyed a relatively benign time of late where the basics of life, plus a few luxuries, could be had whilst still having the prospect of putting some money aside for the odd rainy day or two.

Then, of course, (being human) we then proceeded to hurry, helter-skelter, to bugger up the nice little zone of comfort within which we found ourselves.

Finding the products of our technologies to be pleasant and convenient we then got greedy. We wanted more and, in that wanting, gave space to other greedy people who, for a price, were willing to provide us with more.

Let’s look at some of what we wanted in terms of food and fuels since these are the most immediate of our daily needs and desires.

• Better quality food – less grit, for a start – with brighter colours and more varied flavourings, artificial or not, which would enable us to differentiate our “lifestyle” from those less well off than ourselves (including our silly kid sister who was dumb enough to marry that throwback who digs ditches for a living).
• Greater quantities of food so that we could gorge ourselves three or four times a day rather than eating small amounts continually through the day as our bodies were designed to do when we were evolving as hunter/gatherers – thereby fostering the growth of global industries in slimming products and remedial medical healthcare.
• Faster food so that the tedious nature of the preparation and processing of cooked foods could be lessened.
• Ever greater supplies of power in the form of electricity because we didn’t want to wear lots of clothes around the house or work and also because the old wood-fired kitchen range was too dirty and too much hard work to clean every day.
• Even greater supplies of fossil fuels because we needed to power the electricity plants and to propel larger, faster vehicles of personal transportation which could give us a shirtsleeve environment in which to wait out the traffic jams on the way to and from work and the supermarket.

Lots of wants.

My point here is that we have ourselves to blame for many of the reasons behind high prices. Someone has to be paid to produce, package, store and deliver the objects of our desire. Our desires also open us to exploitation by those who would wish to manipulate and escalate those same desires in order to provide more so-called “choices” as a means of generating further sales and revenues by way of marketing and advertising.

But there are other ways in which we are subjected to ever increasing pricing which, when all is said and done, we have little control over.

Now, before I proceed any further, I need to stress a couple of things.

Firstly, I am not too different from the bulk of Western society in that I enjoy the products and services that have been created and made available to everyone who can afford them. I have even managed to be able to buy some of them. I also feel the occasional twinge of lust for the latest mobile phone or big hairy 4×4 – although one of the very few benefits of advancing age is the ability to exert some measure of control over those twinges and to refrain from impulsively either reaching into my hip pocket or signing some usurious agreement to hire the object of desire for a period way beyond the object’s value and practicality.

Secondly, within certain limits of taste and capability, I am just as capitalistic as the next man. I like to turn a profit - and the more the better. Admittedly, I am a small-time capitalist, never quite having managed to beat my conscience into the required degree of insensibility to be able to view my fellow humans merely as targets for plunder. I guess I must be a failure – although I do manage to get by. My sleepless nights are caused more by worrying about how I shall survive, sans pension etc., (don’t ask – it’s a long story, as the cricket said to the ant), rather than subconsciously stressing over the deep patina of tarnish building up on my soul.

My problem is not so much with the de-skilling of the past couple of hundred years or so - an inevitable consequence of the need to develop an increasingly complex society necessary to cater for the rank stupidity of humankind as it remorselessly breeds itself into global Ebola-like parasitical extinction.

My problem with the current situation regarding price increases in the very basic needs of life rests more with the fact that most of these increases are totally artificial and are motivated by the plain outright grasping greed of a relatively small number of individuals wishing to enrich themselves even more than they already are by further impoverishing the already poor and vulnerable.

There are a number of parties to this concerted “conspiracy” (don’t you just hate that word?):

1. Governments seeking to ensure their national interests;
2. Commodity and stock exchanges and their associated traders, speculators and brokers;
3. The large wholesale, retail and distributive chains (increasingly often integrated under single ownership);
4. Consumers – as both participants and victims.

Each of the above parties is motivated solely by greed and self-interest at the expense of others. Each is able to operate and gain by virtue of the fact that, whether we like it or not, the world is based upon the capitalistic models and theories developed and honed over the last few hundred years or so. Even former and current communist/socialist governments and ideologies have found themselves forced to modify their pretty theories in order to survive – in the case of mainland China to positively thrive – in the harsh world of capitalistic trade and business. Everybody wants to turn a buck.

However, capitalism – as with every other economic theory, I guess – contains within its corpus some fundamental flaws which, long-term, will probably render the entire edifice unworkable without some speedy rectification.

The main long-term problems with capitalism are, as I see it, the concepts of firstly, eternal economic growth and, secondly, charging prices based on what the market will bear at any given time.

These two fundamental underpinning ideas are, ultimately, unsustainable and will create the conditions under which capitalism will, sooner or later, fail unless modified.

• Untrammelled economic growth can only cause an eventual saturation of the marketplace – even allowing for provisions such as the inbuilt obsolescence of products and services (which, already, is a major feature of modern production and economic methodologies) and the enrichment of the entire population of the planet in order to provide sufficient markets for greater and greater production outputs (and which we are most certainly not seeing at present). There seems to be no inherent concept of reaching for and attaining a sustainable equilibrium.
• The idea of charging the very most that the end user of the products and services produced can afford can only result in the near- and long-term widening of the divide between the rich and the poor. Those at the lower end of the economic scale have little or no opportunity to accumulate anything from their labours since so much, if not all, of their incomes are utilised in acquiring just the basics of life – simple foods, rude shelter and public transport. Thus, the poor remain poor and, as such, are of little benefit to capitalism other than as a pool of cheap labour. Their poverty prevents their empowerment as producers and consumers of products and services and their value to the capitalist model is minimal. Even raising their wages accomplishes nothing due to the impact upon production costs and subsequent price rises.

Having said all that, let us now return to the “conspirators” in the current tidal wave of price hikes in fuel and energy.

The prime example of a government serving its own self-interests in recent times has been that of the United States creating (much as Nazi Germany did in the 1930’s) the conditions to explain and excuse their invasion of Iraq five years ago. In so doing they began the entire process of market uncertainty and price escalations in which we find ourselves today. Oil prices commenced their upward march towards the top of a hill of which no-one outside of the oil industry knows the height. In starting and maintaining an unwarranted war (“We’re prepared to fight for 100 years!”) the inevitable consequence was to shake the global oil market into pessimism and the resultant supply fears – even though, notwithstanding the predictions of the 1960’s and 70’s, there is, in fact, no shortage of oil in the world. Indeed, hardly a month goes by without some announcement of a major oil discovery somewhere on the planet.

The only real beneficiaries of the Iraq war have been the oil companies. Oh, yes – and the current oil industry-dominated US political administration.

Gee, what a coincidence.

De-stabilising the global oil market then gave others the chance to cash-in on the uncertainty.

Commodity exchanges, brokers and traders could then “legitimately” demand ever higher prices for the black gold on the pretext of supply uncertainties and the claimed natural balance between supply and demand based upon the old market maxim of charging whatever the market could bear.

This, of course, totally ignored the fact that, despite the best efforts of the OPEC oil cartel, oil supply then and now has never been under anything remotely approaching threat. Nor were oil production costs on the increase.

Traders and speculators were, in effect, given license to artificially generate and exacerbate a supposed crisis in oil for the sole purpose of increasing their turnovers, margins and personal commissions under the guise of serving the best interests of their stockholders.

Consider this:

• Several days ago a US Navy warship fired a few warning shots across the bows of a couple of (supposedly) Iranian speedboats.
• Immediately upon that news the price of a barrel of oil rocketed by $3!

Where was the threat to world oil supplies that merited a 2% increase in the oil price in the space of a couple of hours?

There was, of course, no justification – other than the traders and speculators grabbing a chance to further gouge the world for their own personal benefit.

We have seen similar situations recently when a refinery closes for a day or two because of bad weather. Or when a Nigerian pipeline gets looted or attacked by those who feel excluded from the national bonanza. As if a single locus of supply or transport is going to impact upon the needs of the entire world. In a time of plentiful supply and growing reserves known to be far greater than current production for the next fifty years.

Please. Don’t. Insult. Our. Intelligence.

The same applies to the traders of other commodities – particularly food. They have been only too pleased to hitch themselves to the coat tails of the oil traders and to take similar advantage.

Sure, the world’s population is growing and, yes, the new kids on the middle class block – the Chinese and the Indians – are, not surprisingly, wanting more and better food than they have had for the last couple of thousand years, as well as all the shiny toys that the West has been flaunting in their faces since the 1800’s. But, thanks to the Green Revolution of the past few decades, the world is not, in fact, short of food and we have the land and technology to feed many times the present global population. Properly set up and managed, just Zambia, Zimbabwe and Mozambique could, on their own, provide almost half the world with staple cereals.

On the pretence of a supposed food shortage, staples such as wheat and rice are traded and re-traded many times, each trade generating a profit for the traders until we have the crazy situation where, for example, rice has risen in price by at least 70% in the last three months and Thai rice farmers are having to put armed guards on their paddy fields.

Then there are the speculators who purchase large stocks of certain commodities (often in Third World countries) when prices are low – usually at harvest times when the market is glutted – and then hoard those stocks away from the marketplace until existing supplies diminish and prices rise in response. The use of foodstuffs and fuels as mechanisms of profiteering against the human right of access to affordable food is cynical and barbaric.

Contributing to the lunacy of the current price rises in commodities is the next group of “conspirators”, the large retail chains.

Without contributing one whit to the production of the foodstuffs or oil products they peddle, the retail chains can charge the consumer anything from 25% to 500% above cost for the doubtful privilege of distributing the goods to within reach of that consumer. (Real estate chains, for example, can’t do that but have been accused recently of deliberately and artificially inflating the asking prices of properties in order to increase the size of their commissions. The concept of charging whatever the salesman thinks the dumb schmuck in front of him might be stupid enough to commit himself to prevails everywhere). No wonder property prices now prevent first-time buyers from entering the market and forcing people away from their ancestral roots to seek survival in the global urban migration.

Perhaps it might not be so grotesque were these chains to pay their workers over the legal minimums; or to employ people on a basis other than casual and temporary; or to stop using their commercial volume purchasing advantages to coerce farmers and independent distributors through restrictive practices into accepting prices which then render those businesses marginal.

Matters are worsened when one considers the fact that these chains spend many millions (Rands, Dollars – it doesn’t matter) advertising in the print and electronic media with the constant and perennial claims of being the cheapest and offering the greatest savings to the consumer.

Such claims would only be justified if retail prices were not the result of price fixing and collusion between the wholesalers and retailers, as well as between the retailers themselves. Recent investigations in Australia, Britain and South Africa indicate that price fixing is rife and may, in fact, be prevalent – especially through the good old “recommended retail price” mechanism.

The final party to the “conspiracy” of artificial prices is the consumers themselves.

Consumers are their own worst enemies. Motivated by their own personal greed, stimulated by enticing advertising, too many consumers will willingly pay whatever is asked. Their desire to have whatever it is that they are desirous of feeds the concept of being allowed to charge whatever the market can bear. They have forgotten the old days of the village market where prices were negotiated to the satisfaction of both buyer and seller. If neither party was happy with what was being offered then that party could decline to trade and depart the scene.

A high street supermarket, for example, is nothing more than a village marketplace for the local community (many such supermarkets, in fact, claim such a heritage for purposes of brand identification). But because a supermarket has got pretty displays, clean floors, banks of glittering refrigerators and piped Muzak, people have been intimidated into thinking that they are no longer permitted to haggle. The price tag on a shelf is nothing more than an indication by the retailer of what sort of offer he is prepared to consider for that particular item. If the consumer accepts that tag then that is what he is offering and the retailer is only too happy to accept both the offer and the settlement.

So, although the consumer is all too often the victim of artificially high prices, he is also stupid not to realize the power at his command were he to challenge the exorbitant prices confronting him and to make an amended offer. If the retailer doesn’t like the offer he can ask you to leave his premises and thereby lose a sale. If sufficient consumers likewise challenge the retailer’s overly high margins that retailer would soon have to re-consider his position or face the prospect of going out of business.

The consumer as a group also fails to realize that, if push came to shove, he could forego one or two meals or delay by a few days or weeks the purchase of that washing machine/fridge/lounge suite/car as a way of demonstrating his power to the retailers. Aside from the health and moral benefits to be had, the temporary drop in sales for retail chains could create sweaty brows and an increased consumption of antacid tablets sufficient to bring about a re-consideration of extorting monstrous margins in favour of reasonable returns within a stable price environment.

I do not know the answers to solving the present crisis in food and fuel prices. But I do know that we need to do something to curtail and control the excesses of what is an otherwise workable system.

Capitalism needs – desperately – to find a path away from the boom and bust short-term maximum gratification of the profit motive. Sustainability and eventual equilibrium needs to be achieved so that the one can profit but not at the expense of the other.

Additionally - and equally desperately - the concept of pricing to what the market can (only just) bear needs to be adjusted to one where prices are directly related to fixed and fair margins over the cost of production.

Only once such equity is achieved can capitalism then be justifiably linked to democracy.

Money could still be made in large enough amounts to continue attracting the interest of the intrepid. But we must also find a way to enable the less intrepid to survive in relative comfort and security.

Spearpoint.

27 April 2008

A couple of weeks or so ago some kindly soul sent Spearpoint some nice comments about this blog. The same person also kindly offered to add my blog to his RSS feed.

Whoever you are, I thank you.

However, I owe you an apology.

My antediluvian skills with a computer caused me to (inadvertently) delete your mail which, for some obscure reason, had appeared on my spam list. Your highly flattering comments were flushed away with the dross of auto and other insurance offers.

Mea culpa.

Please do not think that I am so typically South African as to have ignored your mail or that it was not greatly appreciated. Those who would take the time and trouble to respond to this little blog make the whole exercise worthwhile for me.

If you wish to contact me again I shall be only too pleased to properly acknowledge you and your comments.

My thanks again.

Spearpoint.

I thought so…

Reactions to the “Kill the criminals” news story:

- Indignation. Shock. Horror.

- Everyone jumping on the bleeding-heart political bandwagon.

- How could the Deputy Minister of Safety and Security be so callous and uncaring about our poor, defenseless, misunderstood criminals when they are so clearly virtuous and upright members of our society?

- How dare she advocate that the police kill them? After all, they are some of the most productive members of our economy – crime is about the only area of growth in South Africa.

…………………….